Having trouble understanding how leverage in MIS works

General
1

Hello,
I’m really having trouble understanding how MIS trades work. I mean, does an MIS trade use leverage by default? Suppose I have 1 lac in my account, using 11x leverage, I can purchase 11 lacs worth of shares. But, what if I don’t want to use that kind of leverage on a single trade? Can I break up that 1 lac into several trades and still use 11x leverage on all those trades? Also, can leverage be turned off on MIS trades? Thanks :slight_smile:

2
  1. Yes you can utilize your amounts into multiple shares…
    For Example:-
    Stock A -> LTP is 100 INR -> Zerodha is giving you 11X leverage -> Buy 1000 shares -> 1000 INR margin Utilized…[Just as Example.]
    Stock B -> LTP is 200 INR -> Zerodha is giving you 8X leverage -> Buy 5000 shares -> 20000 INR margin Utilized…

So you can trade in multiple.
2) 8X-11X leverage [near by Less and more] is only available in Intraday as MIS order.

3

Hey, thanks for your reply. Are you sure about that? Because I saw another thread where people replied saying it’s not possible: Leverage related query

4

Currently in my Account I have 39K amount. And everyday I am doing Intraday with BO / CO . And Everyday I buy and sell 2-3 stocks . For Example . Today , VEDL and Hindalco.

5

I see. Just wanted to confirm because one of the responders on that thread is a moderator :slight_smile:

6

Zerodha giving margin for main stocks only.
…we can’t use in intraday…

7

I hope your doubt was cleared but if not, allow me to simplify.
Using your example of 1 L. If a stock has 11x leverage, you could make 1 trade worth 11 L or you could make 11 trades worth 1 L each or 5 trades for 2.2 L each. Or if you do not wish to use that kind of leverage as you mentioned you could go halfway and make 1 trade for 5.5 L or 11 trades for 55 K each etc. and you could go lower as per your risk appetite. The only limit being 11x for the particular stock that you are trading. There are stocks that allow as much as 14x leverage and some go as low as 3x.
https://zerodha.com/margin-calculator/Equity/
Check the aforementioned link to see what kind of leverage is allowed for particular stocks.
And finally you could get more leverage by using BO and/or CO.

8

Zerodha not giving mis.leverarage for all companies…

9

Daivame ivarkku onnu paranju kodukkamo…zerodha ellathinum leverage kodukkunnilla ennu